KEY STEPS

Compendium on methods and tools to evaluate impacts of, and vulnerability and adaptation to, climate
change

Uncertainty and Risk Analysis

Description

This approach can be applied through critical review of available literature and data or through
data analysis using software programs. Uncertainty and risk analysis allows the user to address the
errors and unknowns often associated with data and information used to evaluate climate change
adaptation measures.

A key element of uncertainty and risk analysis is defining the decision criterion that is most
appropriate for the question at hand. Uncertainty and risk can be assessed qualitatively, using
probability ratings such as slight, moderate, and high. Uncertainty can also be assessed
quantitatively, using decision analysis tools (e.g., decision trees) or sensitivity analyses such
as Monte Carlo analysis. This method is often used in conjunction with other assessment techniques.

Appropriate Use

This tool is an important step in any assessment of climate change adaptation measures. Quantitative
analyses using decision theory or simulation techniques are most useful when evaluating the data used
for benefit-cost or similar quantitative analyses.

Scope

All locations; all sectors; national or site-specific.

Key Output

Depending on the method used, a quantitative or qualitative estimate of the uncertainty or risk
associated with data being used to evaluate an adaptation measure.

Key Input

Information and data used for other analyses of an adaptation measure.

Ease of Use

Relatively easy to apply

Training Required

Requires an understanding of the policy objectives and adaptation measures being considered. Monte
Carlo and other quantitative analyses require training in specific techniques and uses of statistical
software.